Description

Social Return on Investment (SROI) is generally reported as a ratio between the monetary value of outputs/outcomes and the monetary value of inputs. As such, it provides both a quantifiable cost-benefit analysis of a given project / programme, as well as a tool for comparing different investments either as a forecast or a post investment evaluation. Proponents of the SROI measurement approach claim that it takes a more ‘holistic’ view of the various impacts that a given project/programme has on beneficiaries, but this is a matter of debate – and also depends on the specific choices made by and resources available to the SROI assessment team.

Calculating SROI can only be done if there are clearly identifiable social well-being output/outcome indicators of value arising from the target project/programme, and credible SROI reporting generally requires the services of a qualified SROI expert.

While the product of an SROI assessment is a quantifiable and comparable measure of expected or achieved return on resources deployed, the process of conducting an SROI assessment is also seen as a valuable activity as it explicitly involves stakeholders and beneficiaries in the assessment process. This is generally thought to increase the credibility of the measurement and also to raise the awareness of all stakeholders of the aims and value of the project. The specifics of this process are described in the measurement and procedure section below.

Scale as linked to D2.2 framework

Delete as appropriate:

• National
• City
• Neighborhood 
• Street
• Household
• Object

Data source [ link to data framework]

• Investment cost records
• social well-being benefits

Data needs

• Amount (in monetary terms) of investment in the NBS being assessed for SROI
• indicators of social well-being value created by the NBS
• stakeholder-based attribution of monetary value to a unit of the social well-being indicator
• evidence-based attribution of the proportion of social well-being created to the NBS – generally linked to a clear theory of change, and examined for ‘drop-off’ over time
• evidence-based

Expected Outputs

• cost/benefit

Calculation methods

• Details on the procedure for measuring SROI are widely available through any number of public websites and associations. The website for the EU initiative “Responsible Research and Innovation (RRI)” is a good place to start when looking for further information. The RRI ‘Toolkit’ has a link to a seminal SROI guidebook from the UK, “A guide to Social Return on Investment”, from which the summary procedure included here is drawn.
• SROI is a 6-stage process that begins with the definition of scope for the assessment and identifying the stakeholders who will be involved and the main outcomes (impacts) to be measured. If the work of defining the NBS project’s ‘theory of change’ has already been done (as part of the development of another indicator measurement), then this should provide a good starting point for Stage 1: scope and stakeholder definition – which includes those expected to benefit from the project (beneficiaries) as well as those providing any maintenance or other services related to the NBS and those funding the project. Work on other social well-being indicators will also provide useful input to Stage 2: Mapping Outcomes. Each stage is outlined below – however this factsheet does not substitute for detailed step-by-step guidance available from the recommended sources if an SROI assessment is to be undertaken.
• Stage 1: Establishing scope and identifying stakeholders.
• Stage 2: Mapping Outcomes.
• Stage 3: Evidencing and Valuing Outcomes.
• Stage 4: Establishing Impact.
• Stage 5: Calculating SROI.
• Stage 6: Reporting, using and embedding measurement.

Links and references

• Ebrahim, A.; Rangan, V.K. (2014) “What impact? A framework for measuring the scale and scope of social performance”. Calif. Manag. Rev. 2014, 56, 118–141.
• Fujiwara (2013) “The Social Impact of Housing Providers”. HACT Report accessed at: https://www.hact.org.uk/sites/default/files/uploads/Archives/2013/02/The%20Social%20Impact%20of%20Housing%20Providers%2 0report2013.pdf
• Hamelmann C, Turatto F, Then V, Dyakova M. Social return on investment: accounting for value in the context of implementing Health 2020 and the 2030 Agenda for Sustainable Development. Copenhagen: WHO Regional Office for Europe; 2017 (Investment for Health and Development Discussion Paper)
• Liket, K.C.; Rey-Garcia, M.; Maas, K.E. (2014) “Why aren’t evaluations working and what to do about it: A framework for negotiating meaningful evaluation in nonprofits. Am. J. Eval. 35, 171–188
• Maybe, J. (2015) “Useful Theory of Change Models” Canadian Jnl of Prgm Eval. 30(2) 119-142.
• Nicholls J, Lawlor E, Neitzert E, Goodspeed T. (2012) “A guide to social return on investment”. 2nd ed. London: The Cabinet Office; 2012. https://ccednet-rcdec.ca/sites/ccednet rcdec.ca/files/a_guide_to_social_return_on_investment_revised.p df. Accessed 25 Aug 2020
• Ruff, K. and Olsen, S. (2019) “The Next Frontier in Social Impact Measurement Isn’t Measurement at All” Standford Soc. Innov. Rvw, Online 10 May 2019 https://ssir.org/articles/entry/next_frontier_in_social_impact_mea surement#
• Solorzano-Garcia, M., Navio-Marco, J., and Ruiz-Gomez, L. M. (2019) “Ambiguity in the Attribution of Social Impact: A Study of the Difficulties of Calculating Filter Coefficients in the SROI Method“. Sustainability, vol. 11, no. 2 (2019): 386-405
• Totter, L., Vine, J., Leach, M. and Fujiwara, D. (2014) “Measuring the Social Impact of Community Investment: A Guide to using the Wellbeing Valuation Approach” UK: HACT https://www.hact.org.uk/sites/default/files/uploads/Archives/2014 /3/MeasuringSocialImpactHACT2014.pdf?sid=9120